Escrow Account Audit Deadline for Prepaid Payment Instruments
Current · Source: Reserve Bank of India · RBI/2010-11/341 · issued 27 Dec 2010 · ~1 min read
Quick answerRBI mandates that all authorised entities submit a quarterly auditor certificate on escrow account balances within a fortnight of quarter-end, as per circular dated December 27, 2010.
The rule, in the simplest words
Every quarter, get an auditor (independent checker) to sign a certificate showing the amount in the escrow account (a safe holding account for prepaid money).
Send that auditor certificate to RBI within a fortnight (15 days) after the quarter ends.
The rule applies to all scheduled commercial banks and authorised payment system operators that issue prepaid payment instruments (cards or wallets you load money onto).
Missing the deadline can lead to RBI checking you closely or imposing penalties under the Payment and Settlement Systems Act.
How it plays out — a real example
Anita, the prepaid‑payment‑instrument officer at HDFC Bank in Delhi, receives the quarter‑end report on June 30, asks the external auditor to certify the escrow balance, and makes sure the certificate is filed with RBI by July 14, updating her compliance tracker and informing the audit team, so the bank stays on the right side of the rule.
What changed
RBI observed non-compliance with the existing timeline for submitting auditor certificates on escrow account balances. It now explicitly requires the certificate to be furnished within a fortnight from the end of each quarter, as per the circular of December 27, 2010.
What it means for you
Banks and payment system operators must tighten internal processes to ensure auditor certificates are prepared and submitted promptly. Delays could invite regulatory scrutiny or penalties under the Payment and Settlement Systems Act.
What you must do
Align your internal audit schedule to produce escrow account certificates within 15 days post-quarter.
Notify your audit team and compliance department about the fortnight deadline immediately.
Review current submission timelines and fix any gaps to avoid non-compliance.
Maintain a tracker for quarterly certificate submissions to ensure timely filing.
Who it affects
All scheduled commercial banks issuing prepaid payment instruments, Authorised payment system operators handling prepaid instruments
RBI’s words: “A reference is invited to our circulars ... RBI/2010-11/341 ... dated December 27, 2010”
📜 Read the original circular — full text as issued by RBI
RBI/2010-11/341
DPSS.CO.OSD. No. 1445 /06.12.001/ 2010-2011
December 27, 2010
To
All Scheduled Commercial Banks / Authorised Payment System Operators
Dear Sir,
Issuance and operation of Prepaid Payment Instruments in India –
Auditor Certificate on the balances in Escrow account
Please refer to Para 7.3. of the policy Guidelines DPSS.CO.PD.No. 1873 /02.14.06/ 2008-09 dated April 27, 2009 for issuance and operation of Prepaid Payment Instruments in India.
2. It is observed that the authorised entities are not adhering to the prescribed time frame laid down for submission of Auditor’s certificate. All authorised entities are advised to furnish a quarterly certificate on the balances held in the Escrow account in accordance with the above Guidelines, from an auditor within a fortnight from the end of the quarter to which it pertains.
3. These directions are issued under Section 6(1) of the Payment and Settlement Systems Regulations 2008 read with Section 12 of the Payment and Settlement Systems Act, 2007.
Yours faithfully
G. Srinivas
(General Manager)
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2010-11/341 · issued 27 Dec 2010. The plain-English explanation above is BankPulse’s own independent summary.
Notify your audit team and compliance department about the fortnight deadline immediately.
📜 Compliance
Align your internal audit schedule to produce escrow account certificates within 15 days post-quarter.
Review current submission timelines and fix any gaps to avoid non-compliance.
Maintain a tracker for quarterly certificate submissions to ensure timely filing.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are a Compliance officer at a bank this circular applies to (All scheduled commercial banks issuing prepaid payment instruments, Authorised payment system operators handling prepaid instruments), your first concrete step on “Escrow Account Audit Deadline for Prepaid Payment Instruments” is: “Align your internal audit schedule to produce escrow account certificates within 15 days post-quarter.” (RBI issued this 27 Dec 2010).
Action required: Align your internal audit schedule to produce escrow account certificates within 15 days post-quarter.
Action required: Notify your audit team and compliance department about the fortnight deadline immediately.
Action required: Review current submission timelines and fix any gaps to avoid non-compliance.
Action required: Maintain a tracker for quarterly certificate submissions to ensure timely filing.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=6178&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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